Life Insurance Quotes

Making use of life insurance in the event of a natural disaster

09/09/11

While life insurance offers peace of mind for policy holders and their beneficiaries in the event of the policy owner's death, it is also a form of assurance against damage or disaster, according to Fox Business News.

Experts say that two immediate sources of emergency cash in the event of a natural disaster are a person's loved ones and the government. Loans from family and friends will often be on very favorable terms, and taking the terms seriously is best made a priority. In the case of government assistance, victims of natural disasters should look at what's offered by the Federal Emergency Management Agency and the Small Business Administration, two agencies that can cover a variety of costs, including repairs, medical bills and housing, according to the source.

Life insurance policies are another good source of funding in the event of a disaster because they are often easy to access without penalty. While variable policy owners will need to be cautious of market performance if they borrow a significant percentage from their policy, guaranteed policy holders can often borrow with the penalties that only affect interest.

According to the Insurance Information Institute, individual life insurance policy ownership saw its lowest levels in half a century in 2010. With rates currently at significant lows, it's a good time to both purchase a policy or borrow from one in the event that a policy holder needs to, as interest expenses may be negligible.

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